PPL Montana, LLC v. Montana, ___ U.S. ____ No. 10-218 (February 22, 2012)
http://www.supremecourt.gov/opinions/11pdf/10-218.pdf

Summary: United States Supreme Court engages in a historical fact-finding tour of old documents, including the Lewis and Clark notes, to determine if Montana or PPL, as riparian landowners, hold title to riverbeds underlying the PPL hydroelectric dams in Montana.

Background: Section 3, Clause 1 of the US Constitution states: “New States may be admitted by the Congress into this Union; but no new State shall be formed or erected within the Jurisdiction of any other State; nor any State be formed by the Junction of two or more States, or Parts of States, without the Consent of the Legislatures of the States concerned as well as of the Congress.” Since the admission of Tennessee in 1796, Congress has included in each State’s act of admission a clause providing that the State enters the Union “on an equal footing with the original States in all respects whatever.” This constitutional doctrine has been held to cause any navigable rivers present in a state upon statehood to become sovereign waters of that state unless the United States had previously granted those waters to a third party. Non-navigable waters are not held by a sovereign.

PPL owed a number of hydroelectric dams on Montana rivers. It never paid any rents to Montana for the use of the riverbed. In 2003 a citizen group sued PPL asking that the court find that the dams were built on state-owned lands. Montana joined the suit. The case was dismissed for lack of subject matter jurisdiction. The case was refilled in state court. Montana argued that under the equal-footing doctrine that it owned the riverbeds and could charge rent. The court awarded Montana an order that PPL pay Montana $40,956.180. The Montana Supreme Court affirmed, finding that the rivers in question were navigable because parts of them were navigable. The court found that portaging was not an impediment to a river’s status as “navigable.” The court also held that the rivers were therefore owned by Montana.

Justice Kennedy, writing for a unanimous court, decided that the court needed to determine if the river was navigable at the time of statehood. He rejected the Montana court’s determination that a forced portage had no effect on navigability. He also cited a number of cases in which rivers were divided into navigable and non-navigable sections.